(Last Updated On: August 6, 2016)

Theoretically GST can be introduced by October: Arun Jaitley, Finance Minister

In an exclusive chat with Supriya Shrinate of ET Now, Finance Minister Arun Jaitley says so far the empowered committee has exhibited good leadership, it has functioned well and once it converts itself into a GST Council, things should become better. Edited excerpts

Supriya Shrinate: Now that the dust is settled and your negotiations are done and that had been long and hard. In some sense, is the sense of accomplishment more because the GST was being seen as hallmark of reforms. Everything that you did was being judged whether you can or cannot pass the GST.

Arun Jaitley: I think it is a very critical step forward as far as the country is concerned and not only from the point of view of indirect taxation structure in the country but the fact that the GST Constitution Amendment Bill has been passed unanimously demonstrates in a major way India’s collective desire to reform and grow. At the present stage, where the global economy is in a serious challenge, where demand the world over is low, countries are still struggling to come out with new instruments of how to revive their own economies, if India is to continue to be at least in the growth rates a global leader, some questions almost become synonymous with the pace and desire of reforms. And I think the GST was one of them.

Supriya Shrinate: But now that it is done, do you believe you can make the audacious attempt that aiming at 10% growth rate in this term of your government?

Arun Jaitley : Well I still feel very high growth rates are possible when the global winds are in support. When the global winds are obstructive, trade shrinks, commodity prices are low, then to reach very high rates of growth is extremely challenging. India, of course, did manage 7.2% and 7.6% in the last two years despite a bad monsoon. Hopefully, we should improve on that if the monsoons is looked to be much better and I think a lot would depend on how the global environment is.

Supriya Shrinate: In the sense of accomplishment and I think you deserve credit for bringing about that consensus. There is accomplishment in cobbling together the concensus and there is also the daunting task that lies ahead, a lot more needs to be done to meet that deadline?

Arun Jaitley: I think both the points that you make are significant. The bringing about of consensus was based on the fact that you had a large number of NDA governments in the country. So, more states were on board. You had several states with regional parties. Except for some reservations of the AIADMK, all the other political parties, particularly the one which controls the state governments were overwhelmingly in support.

Now they belong to regions which were essentially consuming states and they felt that they needed more revenue and as consuming states, the GST was a better proposition for them. So between the NDA states and the regional parties, you had an adequate number of states on your side. Congress conventionally was always in favour of the GST. It had in between raised some issues and I think we adopted the proper and correct course of negotiating with them.

Accommodating some of the concerns, convincing them of our view point in relation to some others and I am glad the way it ended in the Upper House. Now, it goes to the Lower House and hopefully things should work out well.

Now as far as the deadline is concerned, it is a very challenging deadline for the reason that now it has to be approved by the Lok Sabha, then by the State Assemblies that I think is the easier part.

Thereafter, all the procedural modalities will have to be done starting with the two laws to be approved by Indian Parliament and one law to be approved by all the State Assemblies that is going to be a time consuming process and you are going to be cutting it very fine thereafter. Subsequently, you will also have to have all the functional modalities worked out between the centre and the state so that the same assessee is not assessed by two different authorities. Then, the very purpose of GST itself would be defeated. So where do you divide the cut offs and that is a legitimate view some of the states have said that we must have clear jurisdictions defined.
Supriya Shrinate: The reason why I am asking that question is that lot of what needs to be done here after whether it is rates, whether it is threshold, whether it is dual control lies in the realm of the GST council where decisions are going to be far more political than technical. That may delay things. If things get delayed, do you plan to introduce the GST mid-year, if need be, say the 1st of October?

Arun Jaitley : Well theoretically not being an income tax law, it can be, that is possible. It is a transactional tax. Theoretically that is possible but I think our current effort has to be that so far the empowered committee has good leadership, it has functioned well and once it converts itself into a GST Council with the central government also as a member though even today we coordinate with them,

I think things should become better and I must say to the credit of the empowered committee it has not allowed itself to be divided on political lines at all…

source http://economictimes.indiatimes.com/ 05.8.16

GST is transactional tax can be implemented from mid of year also : FM

Theoretically GST can be introduced by October: Arun Jaitley, Finance Minister

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